Xiaomi plans to dislodge Huawei, Samsung in SA
Chinese smartphone maker Xiaomi is looking to take market share from Samsung and Huawei, the respective number one and two brands in South Africa.
As it aggressively tries to entrench itself into the local market, Xiaomi has lined up distribution deals with mobile network operators MTN and Telkom.
The Chinese firm presently has only one distribution agreement with SA’s biggest telco, Vodacom. However, it is driving its devices via an open market on platforms such as Takealot, TFG stores and other official Xiaomi retailers.
The company also indicated it’s targeting to open its own physical stores, known as Mi Stores, in 2022.
This was revealed by Nicola Nell, Xiaomi marketing manager in SA, in a video interview with ITWeb last week.
The interview followed the Chinese company last month launching the Xiaomi 11T Pro – its first flagship smartphone to land on South African shores.
Besides this latest offering, Xiami sold its Redmi and Poco series in SA, brands which target the low and mid markets.
Nell believes the 11T Pro (priced at R13 999) – Xiaomi’s first smartphone to launch globally with its proprietary 120W Xiaomi HyperCharge technology – will be a game-changer, as the company makes in-roads in SA, a market traditionally dominated by Samsung, Huawei and Apple iPhone.
According to Nell, Xiaomi HyperCharge technology enables a 100% charge in just 17 minutes. This is achieved through technologies such as dual-charge pumps, dual-cell battery structure, MTW, Graphene application on Li-ion battery and Mi-FC technology.
Other Chinese smartphone brands − such as Oppo, Vivo and Itel − have also tried to penetrate the tightly-contested local market.
“We launched the Xiaomi 11T Pro towards the end of last month. It has been launched in our open market at a cash price and it’s shortly going to be available in Vodacom stores on contract,” Nell says.
“In comparison with our competitors, it’s R5 000 cheaper than our nearest competitor and about R10 000 cheaper than the next competitor. For such a flagship device, it’s quite an affordable price.”
She notes Xiaomi recently signed a deal with MTN and Telkom for the devices to be available in the mobile operators’ shops.
“Unfortunately, the 11T Pro will not be available in other channels just yet, but we will be launching other models like our 9A, 9C and Redmi Note 10 series with those mobile network operators [MTN and Telkom] and the 11T Pro will come a little bit later. So it will currently be available from Vodacom and our open network distributors.”
She also reveals the firm is growing its team in SA quite significantly. “We have got a lot more people in our retail as well as sales team, and they are really working hard to drive these devices into our distributors. We are starting to see a lot of interest in our flagship device. We are signing new distributors and retailers all the time.”
Nell says with a bigger team now on the ground in SA, Xiaomi is getting devices much sooner following the global launch.
“So we are getting more diversity and options to consumers and I really think we are going to take a lot more market share in 2022.”
Unfortunately, she adds, a limited amount of 11T Pro devices will land in SA, so it will share the devices among its distributors.
“They [11T Pro devices] will not be in their thousands but what I can say is that because the device is so good, it is going to sell very quickly. I think we are going to bring in some more devices quite quickly. I don’t have the exact figures of how many devices we brought into the country, but I am sure they are going to fly off the shelves.”
She points out that Huawei and Samsung are Xiaomi’s direct competitors in SA.
According to Statista, as of June, Samsung was the market leader, with 45.28% of the market share of mobile device vendors in SA. Huawei ranked second, with almost 29%, followed by Apple with 16%.
Nell believes the global challenges that fellow Chinese smartphone maker Huawei is facing will be an advantage to Xiaomi.
In May 2019, former US president Donald Trump announced that Huawei – along with several other Chinese companies – had been placed on the blacklisted entities list. Companies on this list are unable to do business with any organisation that operates in the US.
With the ban, Huawei cannot work with companies such as Google, Qualcomm and Intel, among many others. In the case of Google, this means new Huawei smartphones are no longer able to ship with Google-owned applications pre-installed.
Besides the global headwinds, Huawei SA recently told ITWeb it still maintains a “strong number two” position after Samsung in SA.
“Huawei, unfortunately, has been facing some challenges for a while, so it’s really a sweet spot that we would want to take,” says Nell.
“Samsung is still number one in global shipments and that is what we are aiming for. I believe we will take way more market share with this device [11T Pro] and other devices that we will be launching within the next few months.”
Besides the smartphone push, Nell also notes Xiaomi has over 2 000 internet of things (IOT) devices. However, not all the IOT device line-up is available in SA, but there are plans to start shipping the devices into the country soon.
“Not so long ago, we launched a shop on Takealot and there are between 55 and 60 different items one can purchase from Xiaomi. So we have a diverse portfolio of lifestyle and technology products.”
The company also has plans to open a physical store next year, says Nell. “I believe it’s something SA needs, as people need to go and experience the diverse range of products that we have.
“We are also going to have our set-up in some retail stores, as well as at Vodacom World. That is in the works, and I am sure next year we will have our own personal stores for Xiaomi.”
In regards to customer support in SA, Xiaomi has partnered with a company called Triple S to handle after-sales issues.